The strange and challenging world of Cuban tech start-ups
BY MIMI WHITEFIELD
Cuba may have one of the lowest Internet penetration rates in the
Western Hemisphere, but that hasn’t stopped the development of a tech
start-up community whose young entrepreneurs have aspirations similar to
millennials in the United States.
To take advantage of the growing number of paladares, or private
restaurants, one group has developed a Yelp-like application called
AlaMesa that serves up information on a restaurant’s location, average
price and cuisine, in both English and Spanish. You’ll also be able to
find the latest on parking, takeout, wheelchair accessibility and
whether there’s a wine list or entertainment.
Another group of four young computer scientists is working on Isladata,
a Cuban market research database. They have a prototype online that
explains the founders’ interests range from data and text mining,
artificial intelligence and computer vision to virtual reality. Beta
versions of its Cuban real estate and automotive market research are online.
And brothers David and José Ernesto Alonso operate A+B, a workshop that
repairs mobile phones, cameras, TVs and other electronic devices. But
they say their real interest is developing apps, and they use the
earnings from the repair business and updating clients’ phone systems as
the seed capital for their own projects.
But the emerging world of Cuba 2.0 is fraught with challenges. Even
though many Cubans now have Smartphones, they don’t have data
connections and even if they did, they can’t simply go to Apple’s App
Store and sign up for their favorites because they have no way to
legally pay for them.
So people who have Internet access — one way or another — pass on
information. It’s a world of referrals and information passed from
person to person by memory sticks or USB flash drives. Tech-savvy Cubans
also have begun using Zapya, a local file-sharing app that uses a
wireless network to upload files from one device and download them to
another. In fact, it’s so popular it’s become a verb, Zapyar, meaning to
Many of the new tech entrepreneurs are reluctant to speak on the record
because they’re still employed by the University of Havana or Ciudad
Universitaria José Antonio Echeverría (CUJAE) , a scientific and
technical campus in Boyeros, and would have to seek approval before
giving an interview.
Holding on to such university jobs is essential because these positions
afford speedy Internet connections at work and occasionally DSL, or more
often pokey dial-up connections, at home for research.
The first time one of the entrepreneurs had access to the full Internet,
he said he was “a kid in a candy store,” surfing around for six hours
But Cubans have become experts in resolviendo, or getting around
obstacles and finding new ways of doing things.
Now, Isladata’s founders are in the process of developing a business
model and say their potential clients are both foreign and Cuban
enterprises. The real estate and automotive markets were natural
starting places since under relatively recent economic reforms, Cubans
can now buy and sell homes and cars without the intervention of the state.
Data that they collect isn’t available from the National Statistics
Office, they say. By analyzing digital ads they’ll tell you, for
example, that the average price of a house for sale in Cuba last year
was $30,000 but in Matanzas it was $38,000 and the most common price
there was $95,000. However, there is no data on the actual selling prices.
The most common asking price for a Russian-made Lada was $15,000 while
the general price asked by owners of 1955 Chevrolets was $12,000. The
owner of the single Jaguar — no year specified — that the Isladata
sleuths turned up last year was asking $10,000 for the vehicle.
AlaMesa also was born of the economic changes that are coming to the
island. Over beers, a group of friends were talking about the new laws
to encourage state workers to become cuentapropistas, who are in
business for themselves, and all the private restaurants that were
cropping up as a result, said Yon Gutiérrez, who became AlaMesa’s designer.
Even though there are guides to paladares — private restaurants —
compiled for foreign visitors, they concluded there really wasn’t a
systematic way for Cubans, who make up about 80 percent of the
restaurants’ clientele, to get information on pricing, menus and even
They also decided their Android app would have to be very light to
download since Internet connections in Cuba are generally poor. Freedom
House estimates only 5 percent of Cubans have access to the open
Internet though more have access to a slow government-controlled Intranet.
So far, the app has been downloaded by almost 5,000 users who also
receive deals and promotions. But the entrepreneurs estimate their
information reaches three times as many people as that and that each
unique visitor views seven or eight restaurants at a time.
For those who can’t download the app, the AlaMesa founders provide an
offline application that is updated every 15 days. It’s passed along via
el paquete semanal, a weekly package or compilation of American TV
shows, programs from Spain and Italy, recent movies, MLB games, Mexican
soap operas, digital copies of magazines, apps, websites, advertising
and more that is customizable and copied and distributed on portable
hard drives and USBs to people all over Cuba who view the content on
their home computers.
Cubans describe this alternative to broadband as “Internet in a box.”
In the paquete, the cellphone numbers of commercial contacts are listed
for those who want to insert advertising in the middle of a sports game
or other popular program.
Customers can buy as much or as little of the paquete as they want. The
entire weekly package is one terabyte and costs 2 CUCs (around $2), but
some customers only want one show or a few music videos. There are
sellers and resellers of the weekly package all across the island and
exactly who is at the top of the pyramid remains something of a mystery.
AlaMesa listings are just part of the copious content that comes out
every Tuesday in el paquete.
The listings also are available at alamesacuba.com and can be downloaded
by foreign visitors before they leave home for use on the island.
AlaMesa also has a Facebook page where it posts culinary and
entrepreneurial news and recipes like a recent one for coffee pudding.
It has more than 4,200 likes. And soon AlaMesa will debut on Google Play.
Currently AlaMesa has 600 restaurant listings in nine Cuban provinces.
Local representatives collect information for listings from restaurant
operators in each province. Restaurateurs pay for ads and also for
photos included with their listings.
Meanwhile, because the Alonso brothers’ self-employment license is for
repairing electronics, they do fix cellphones and computers. But they
say it’s much more profitable to focus on software, unlocking phones
that are purchased abroad and updating operating systems for clients.
“Their phones are not prepared to handle Zapya and other new
applications so they crash their systems and they need our help,” said
David Alonso. There are now about 3 million cellphones in Cuba and
increasingly they are Android Smartphones.
José Ernesto Alonso said he and his brother are using the money they
make from repairs and systems updates to fund their own software and
hardware development projects. “Getting funding for development is
difficult in Cuba,” he said.
The brothers prefer slow, step-by-step growth for their company, said
José Ernesto. “There’s a lot of potential because Cuba is so behind in
all of this.”
But some of the tech entrepreneurs realize their window of opportunity
may be fleeting — especially if the big boys come to town under a tech
opening outlined by President Barack Obama. New U.S. rules allow
American telecom and Internet companies to sell goods and services and
joint venture with Cuba partners — both government and private — to
improve telecommunications and Internet service for the Cuban people.
“We have a window of a couple of years before any of the big players
come in and try to push others aside,” said one of the AlaMesa founders.
“But I try not to be naive about it. Winter is coming.” Still, Cuba’s
small start-up community knows the market and Cuban culture so they’re
still hoping for opportunities.
So far, it’s unclear how engaged the Cuban government wants to be with
U.S. telecom and Internet companies. On July 1, it began rolling out
expanded Wi-Fi service at 35 hotspots around the country and has lowered
the price of connections from $4.50 an hour to $2. The new network
points are available to anyone with permanent or temporary Nauta.cu
accounts, which are available from ETECSA, the state-run telephone company.
A leaked ETECSA document also seems to indicate the government has
drafted a plan for development of home DSL service using Chinese
equipment but ETECSA has said the document was only being used for training.
Google has already come to call several times — ostensibly with a plan
to massively expand Internet on the island via Wi-Fi connections and
cellphones. Twitter executives have been talking with the government.
And Netflix announced in February that Cubans with high-speed Internet
connections and access to international payment methods would be able to
subscribe to the service and watch movies and TV shows for fees starting
at $7.99 per month.
Both Wi-Fi connections and Netflix cost a lot for the average Cuban but
some techies suggest people are willing to pay when it comes to
something that is useful to them. The demand, they say, is huge and now
that expectations have been raised, Cubans are going to want much, much
“There’s going to be a tsunami coming down,” said one tech entrepreneur.
Source: The strange and challenging world of Cuban tech start-ups |
Miami Herald Miami Herald –